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Thursday, November 8, 2007

Sony may quit advanced chip project

Sony may quit advanced chip project

Sony Corp. may withdraw from joint research on next-generation computer chips after agreeing to sell its production operations for the brains inside the PlayStation 3, a spokesman said Wednesday.

Sony has been working with IBM Corp. and Toshiba Corp. to develop manufacturing technologies for next-generation semiconductors.

But the group "is in talks with IBM and Toshiba to review the project," Sony spokesman Tomio Takizawa said.

Sony last month announced a basic agreement to sell its production lines for advanced chips, including the Cell microprocessor at the heart of the PS3, to Toshiba in a deal reportedly worth over one billion dollars,

"Given the sale plan, it would be unreasonable for us to continue research on manufacturing technologies" for next-generation chips, Takizawa said.

Instead, Sony's semiconductor business would focus mainly on manufacturing sensors used in high-vision handycams and digital cameras, Takizawa said.

The sale of the chip lines is part of Sony's efforts to refocus on its core consumer electronics business.

The company, which is recovering from a profit slump, invested heavily in developing the Cell microprocessor -- the brains inside the PS3.

But it is struggling to make a profit from the console in the face of fierce competition from rival Nintendo, with Sony's game unit deep in the red.

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